How many months’ rent do you have to pay as a security deposit?
If you’re renting a property, the landlord will usually ask you to pay a security deposit. This protects them against damage you might cause to the rented property. Wondering how much a landlord may ask for a security deposit and how you pay it? We've provided a brief word of explanation below.
Is a security deposit required by law?
A security deposit is not a legal requirement. Even so, if your landlord asks you to pay one, it must be explicitly mentioned in your lease. In addition, if you live and rent accommodation in Flanders, you are legally obliged to take out home insurance.
A landlord may ask you for a security deposit of up to three months' rent. As a tenant, you can legally arrange that deposit in one of four ways:
- Deposit in a blocked account (the most common way)
- Personal guarantee
- Flemish security deposit loan
- Public Social Welfare Centre guarantee
1. Deposit in a blocked account
You usually put the security deposit on a blocked savings account. That account is in your name (the tenant) and the deposit may not exceed three months' rent.
For example, if you pay 650 euros in rent each month, the landlord may ask you to pay a security deposit of no more than 1 950 euros.
The security deposit remains blocked on the account until the end of the lease. In addition, you (the tenant) receive the interest earned on the security deposit each year. At KBC, you can open a security deposit account online for free, regardless of whether you’re a KBC customer or not.
A second option is a personal guarantee, where it’s not the tenant that provides a sum of money as security, but instead a person or company that acts as guarantor. Parents do this, for example, for a child who wants to live in his/her own place after graduating from college or university.
If you fail to meet your rental obligations as a tenant, the landlord can call on the guarantee for the equivalent of up to three months' rent. However, the landlord has to agree to this arrangement and is entitled to refuse it.
If you’re not in a position to pay the security deposit right away, you might be eligible to apply for an interest-free security deposit loan with the Flemish Housing Fund.
Good to know: These loans are anonymous, so the landlord doesn’t know that the tenant is applying for one.
A final option is to approach the Public Social Welfare Centre (OCMW/CPAS) and ask them to provide a guarantee. They then enter into an agreement with a bank for an amount of up to three months' rent. Again, you have to meet certain conditions to be eligible.
Important: In practice, landlords often ask for the security deposit to be paid in cash or to be credited to their personal account. This is not permitted under the Residential Tenancies Act. As a tenant, therefore, always ask to arrange the security deposit in one of the four ways described above.
Good to know
The KBC Security Deposit Savings Account is a regulated savings account offered by KBC Bank NV Belgium, and reserved for a security deposit.
It is governed by the laws of Belgium. Be sure to read the information at kbc.be/security-deposit-savings-account before opening the account, as well as the key information for savers. This information is also available from your KBC branch.
You can submit any complaints you may have by e-mailing complaints@kbc.be, by calling 016 43 25 94 and/or by sending an e-mail to ombudsman@ombudsfin.be.
Features of a KBC Security Deposit Savings Account
- Interest earned
- Current rate: 0.45% base rate of interest and 0.45% fidelity bonus.
These gross rates are expressed on an annual basis and may change at any time. Current rates are always given here or can be obtained from your KBC branch. If rates change, we will inform account holders of this by post or through one of our digital channels.
Savings start earning interest at the base rate on the first calendar day after the transaction date and cease to earn interest from the calendar day on which they are withdrawn. This interest is paid into your account once a year (with a value date of 1 January) or when you close your account.
You receive the fidelity bonus for amounts that remain on the savings account for 12 consecutive full months called the ‘calculation period’.
Every time a fidelity bonus is acquired, a new 12-month calculation period will start. The fidelity bonus rate is the interest rate prevailing on the first day of a new calculation period. That rate is fixed and remains unchanged for the entire 12-month calculation period.
The fidelity bonus will be paid into your account on 1 January, 1 April, 1 July and 1 October after being acquired in the preceding quarter. Any fidelity bonus acquired will also be paid when you close your account.
- Tax efficient
Individuals who are resident in Belgium are exempt from 15% withholding tax, on the first 1,020 euros of interest earned each year (2024 income). Married couples and legal cohabitees are entitled to an exemption of up to 2,040 euros a year (income year 2024) on a joint account.
- Free of charge
There are no charges for opening and managing the account. - Open-ended
The KBC Security Deposit Savings Account is an open-ended product. The security deposit agreement linked to this account remains in force until the security deposit savings account is closed. - Risks
- Insolvency risk: a maximum of 100 000 euros of your aggregate deposits with KBC Bank are guaranteed per person, subject to certain conditions. In the event of KBC’s insolvency (e.g., if it goes into bankruptcy), you run the risk of losing any deposits you have over 100 000 euros, or their amount could be reduced or converted into shares. You can obtain a copy of our ‘Protection of deposits and financial instruments in Belgium’ brochure from your KBC branch or from www.kbc.be/depositprotection.
- Inflation risk: this savings account also has an inflation risk, as sustained price increases can result in the amount deposited losing value.
- Insolvency risk: a maximum of 100 000 euros of your aggregate deposits with KBC Bank are guaranteed per person, subject to certain conditions. In the event of KBC’s insolvency (e.g., if it goes into bankruptcy), you run the risk of losing any deposits you have over 100 000 euros, or their amount could be reduced or converted into shares. You can obtain a copy of our ‘Protection of deposits and financial instruments in Belgium’ brochure from your KBC branch or from www.kbc.be/depositprotection.
More information about the KBC Security Deposit Savings Account
Please read these documents before opening a security deposit savings account.
Complaints
- If you have a complaint, please contact KBC Complaints Management:
- Tel.: 016 43 25 94
- E-mail: complaints@kbc.be
- If the matter fails to be resolved through this channel, you can turn to the Ombudsman in financial conflicts (www.ombudsfin.be).
Did you know Kate can also help you with your security deposit?
If you’re looking for a security deposit, just tell Kate: ‘I want to open a security deposit account’. You can find Kate, your digital assistant, in the top-right corner of KBC Mobile.
